A Detailed Insight on the SEC’s Slim Chances in the Ongoing Appeal Narrative

In a surprising yet promising turn of events, the Securities and Exchange Commission (SEC) finds itself standing on thin ice, with a mere 3% to 14% chance of succeeding in its appeal against Ripple, a leading player in the cryptocurrency world. This legal odyssey, which has captured the attention of investors and legal experts alike, has seen a series of remarkable victories for Ripple, leaving the SEC in a precarious position.

Bill Morgan, a renowned lawyer with an acute understanding of the case, has been meticulously analyzing each development as it unfolds. In a recent post on X (a popular social media platform), he shared his insights, shedding light on the SEC’s dwindling chances. According to Morgan, there appears to be no significant appellable error that would work in the SEC’s favor, except for a minute aspect concerning Ripple’s ODL sales. However, even this seems to be a long shot, leaving the SEC with an estimated 3% chance of success.

I don’t see any obvious appellable error other than in Ripple’s favor in respect of ODL sales which don’t meet at least two prongs of the Howey test. The SEC’s prospects of success on appeal are very slim and I feel generous today so I am giving it 3% chance of success on appeal https://t.co/FRIFbqzmVA

— bill morgan (@Belisarius2020) October 22, 2023

Supporting Morgan’s analysis, Jeremy Hogan, another prominent attorney, referenced government data that delves into the success rates of appeals in various legal scenarios. This data paints a similar picture, suggesting that the SEC’s chances of winning the appeal against Ripple hover around 14.2%.

The journey leading up to this point has been nothing short of dramatic. Ripple found itself in the midst of a legal maelstrom as the SEC waged a relentless three-year-long battle, challenging the legitimacy of XRP sales on cryptocurrency exchanges. The legal strife took a toll on Ripple’s business, particularly in the U.S., as major crypto exchanges opted to delist XRP, causing a temporary setback.

However, the tide began to turn when the court delivered a pivotal judgment, affirming that XRP sales on crypto exchanges did not contravene securities laws. This landmark victory served as a beacon of hope for Ripple, signalling a potential end to their protracted legal woes.

The SEC’s subsequent loss in an appeal further solidified Ripple’s position. Judge Analisa Torres, in her decisive ruling on October 4th, pointed out the SEC’s inability to establish a strong case, noting the lack of controlling questions of law or substantial grounds for any difference of opinion on the matter.

Adding to the SEC’s series of defeats, October 19th marked another significant triumph for Ripple. In an unprecedented move, the SEC decided to drop all charges against Ripple CEO Brad Garlinghouse and executive chair Chris Larsen, essentially conceding defeat.

Today was an even better day.
Ripple: 3
SEC: 0

In all seriousness, Chris and I (in a case involving no claims of fraud or misrepresentations) were targeted by the SEC in a ruthless attempt to personally ruin us and the company so many have worked hard to build for over a… https://t.co/YsQxewFnj9

— Brad Garlinghouse (@bgarlinghouse) October 19, 2023

Ripple’s chief legal officer, Stuart Alderoty, aptly described the SEC’s move as “a surrender,” while Ripple’s official statement hailed it as “a stunning capitulation.” With the majority of the case now dismissed, Morgan anticipates a quieting of the legal storm, predicting that a final judgment may be rendered sometime next year.

As the narrative unfolds, it is evident that Ripple has emerged stronger, navigating through the legal tumult with resilience and tenacity. The SEC, on the other hand, finds itself reflecting on a series of strategic missteps, as the probability of success in their appeal against Ripple diminishes with each passing day.